Wednesday Watch

Around X:

• @Business

• President Trump met with his national security team in Washington Tuesday to discuss the escalating Middle East conflict, according to people familiar with the matter, fueling fresh speculation that the US is on the verge of joining Israel’s attack on Iran. 
• US President Donald Trump has a wide range of military assets in the Middle East and across the globe in a potential fight against Iran as he weighs one of the most momentous foreign policy decisions of his administration.
• The US Embassy in Jerusalem will remain closed for the next three days, the State Department said, as speculation grows that the Trump administration may be on the verge of joining Israel’s attack against Iran.
• China is using hacking competitions to grow its cyber-army. Find out what's at stake for the US and the rest of the world on the Big Take Asia podcast.
• Viasat is the latest US company named as a victim of the surveillance hack blamed on China that swept up millions of phone records last year, including those of Donald Trump.
• Read up on the key takeaways from the Group of Seven leaders’ summit in Kananaskis, Canada.
• OpenAI CEO Sam Altman said Meta has offered his employees signing bonuses as high as $100 million, with even larger annual compensation packages, as it seeks to build a top artificial intelligence team.
• US rates traders have amassed a record futures bet that the Federal Reserve will take on a more dovish tilt right after Chair Jerome Powell’s term ends in May 2026.
• Here’s the latest news and analysis on the oil market.
• The Federal Reserve is widely expected to keep interest rates unchanged this week. Here's what else you need to know.
• The military has used nuclear-powered ships for decades. Now, commercial shipbuilders are attempting to adapt the technology for cargo.
• General Mills, the maker of Lucky Charms and Trix cereals, will remove synthetic dyes from its products by the end of 2027, according to the Minnesota Star Tribune.
• VCs have approached Anysphere, the startup behind AI code editor Cursor, with a funding deal that would value the startup at more than $18 billion. 
• As the US weighs its response in the ongoing conflict between Israel and Iran, Turkey is preparing more missiles and Russia is worrying for a key ally’s survival: Here’s your Evening Briefing.
• Get up to speed on what's moving global markets. 
• Here's what you need to know to start your day. 

• @ZeroHedge 

• US regulators to lower the enhanced supplementary leverage ratio (eSLR) for biggest lenders to a range of 3.5% to 4.5%, down from the current 5%, reducing key capital buffer after concerns that it constrains banks’ trading in the Treasuries market: BBG.
• Iron Ore Prices Tumble To 9-Month Low, Citi & Goldman Ratchet Down Price Target.
• Chinese Automakers Target Using 100% Domestic Made Chips In New Vehicles.
• *TRUMP TO EXTEND TIKTOK SALE DEADLINE FOR ANOTHER 90 DAYS: WSJ.
• Trump Is Falling Into Hersh's Prophetic 'The Redirection' Trap On Iran: 3 Views On What's Next.  
• An Open Letter To The President: Addressing Our Debt.
• Iran Prepares To Hit US Regional Bases With Missiles If Trump Joins The War.
• "Biggest Pain Trade Is Long The US Dollar": Latest Fund Manager Survey Finds Everyone Is Short The Buck. (graph) 
• Threats From Trump & Hard-Data Dump Sink Stocks & Crypto; Bonds & The Dollar Bid. 

• @MarioNawful   

• IRAN LEADER INVOKES “KHEIBAR” - AND IT’S NOT JUST HISTORICAL. Iran’s Supreme Leader just dropped a not-so-subtle message: “In the name of Haidar, the battle begins. Ali returns to Khaybar with his Zulfiqar.” Allahu Akbar. Fiery imagery. Messianic tone. And a direct invocation of the 7th-century Battle of Khaybar. But here’s the catch: “Kheibar” isn’t just a historical reference - it’s also the name of one of Iran’s most advanced ballistic missiles, unveiled in May 2023.

• @LauraLoomer 

• President Trump should instruct the DOJ to conduct an investigation into the foreign funding of many independent journalists. If you are being paid by a foreign government to push a political message, that is not America First. There are a lot of people on the right who are being paid by Iran, China and Qatar via crypto. Many of them are paid in cash in Dubai. This is well known. If you aren’t registered with FARA and you’re paid by a foreign Islamic country, you are working against America First. This is a national security issue.

• @GatewayPundit

• REPORT: Iran State Media Issues Terrifying Warning About a ‘Surprise Tonight that the World Will Remember for Centuries’.
• Democrat Senator Padilla Fake Cries as He Recounts Being Cuffed After Lunging at Kristi Noem in Cringey Senate Floor Speech (VIDEO). 

• @C_3C_3

• Never forget… Barack Obama funded Iran’s nuclear program. He knew exactly where those funds would end up when he sent the pallets of cash and released the balance. Another move by Obama against America’s interests. Everything leads back to Obama… (video)

@TheInsidePaper

• BREAKING: A powerful X1.2-class solar flare has just erupted from the Sun — the most intense category of solar radiation bursts. This flare could disrupt satellites, cause radio signal blackouts, and potentially trigger geomagnetic storms over the next 24 to 48 hours.

Night Trading 

• Asian equity indices are -.5% to +.5% on average. 
• Asia Ex-Japan Investment Grade CDS Index 77.75 +3.0 basis points. 
• China Sovereign CDS 49.0 +2.25 basis points.
• China Iron Ore Spot 92.6 USD/Metric Tonne -.3%.
• Polymarket: US Military Action Against Iran Before July 66.0% +1.0 percentage point
• Polymarket: Will Iran Close the Straight of Hormuz in 2025? 39.0% +10.0 percentage points
• Swiss Franc/Offshore Chinese Renminbi Cross 8.80 -.05%.
• Bloomberg Emerging Markets Currency Index 37.0 -.04%.
• Bloomberg Global Risk-On/Risk Off Index 68.3 -.4%.
• US 10-Year Yield 4.40% +1.0 basis point.
• Volatility Index(VIX) futures 21.3 -.7%.
• Euro Stoxx 50 futures -.23%. 
• S&P 500 futures +.07%. 
• NASDAQ 100 futures +.09%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by industrial and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 25% net long heading into the day.